The Meaning of Words

Often in real estate transactions, poor communication is the crux of disputes which sometimes lead to flubbed transactions and even law suits.  One overriding principle in contract law is that “words have their normal meaning.”  For example, a buyer in a recent case said to a judge, “What I really meant was that the seller was to fix the roof prior to closing and he didn't.”  What the contract actually said was, “Buyer would like the roof to be fixed.”  The judge ruled on behalf of the seller, stating that it was unclear that the seller was to repair the roof even though the buyer “ wanted” the roof to be fixed. What the contract should have said was, “Seller shall repair the roof to buyer’s sole satisfaction within 5 days of closing”, or something even more definitive.

In the case above, the seller signed the request, making it part of the contract, but never had any intention of fixing the roof because that is not what the buyer communicated.  The buyer went to closing thinking that the seller had agreed to what they thought they were saying.

After a home inspection is completed, most buyers try to renegotiate the contract in order to get satisfaction concerning items they deem to be defective, which in their mind diminishes the value of the property. The process of negotiating such work requirements is usually where the buyers and their agents go wrong.  Writing a request that is specific and crystal clear is of utmost importance!  

A poorly written request may say something like, “Buyers would like items 1 and 3 of home inspector’s report to be addressed.” The inspector may have said something like, “The roof appears to be beyond its normal life expectancy.” In this example, the mistake is that the Realtor® drafted ambiguous contract language and the Inspection Report verbiage is only informational.

When your broker is negotiating on your behalf, you should be sure that they include exact language of what you want, stating very clearly what the task is, who is to do it, who pays for it, when it is to be accomplished and what is the result if the condition is not met. It is important not to reference a document that is not part of the Purchase Agreement such as an inspection report, but instead to be specific in a written request, which when signed will become new contract terms.

Jim Palmer, Jr.
509-953-1666
www.JimPalmerJr.com

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